Elon Musk xAI Exodus Continues as Two More Co-Founders Quit

TLDR

• Two xAI co-founders, Tony Wu and Jimmy Ba, resigned from the artificial intelligence firm they started with Elon Musk less than three years ago
• xAI now has only six of its original 12 co-founders remaining after the latest departures
• Jimmy Ba’s resignation reportedly followed tensions within the technical team over demands to improve AI model performance
• The resignations come days after SpaceX announced it will purchase xAI to create a $1.25 trillion company with plans to go public later this year
• xAI has faced challenges including the Grok chatbot generating deepfake pornography and high cash burn rates while competing with OpenAI and Anthropic

Two co-founders of Elon Musk’s xAI resigned from the artificial intelligence company they helped launch less than three years ago. Tony Wu and Jimmy Ba announced their departures in separate social media posts on X.

The exits leave xAI with six of its original 12 co-founders. Jimmy Ba became the sixth founding member to leave the company. Tony Wu announced his resignation one day before Ba’s departure.

According to the Financial Times, Ba’s resignation followed tensions within the technical team. The tensions arose over demands to improve the company’s AI model performance. Elon Musk has been pushing the team to catch up with rivals like OpenAI and Anthropic.

Neither Ba nor Wu explained their reasons for leaving in their X posts. Both thanked Musk in their announcements. Ba did not respond to requests for comment about the reported tensions.

The departures follow exits by other co-founders over the past year. Kyle Kosic, Igor Babuschkin, and Greg Yang also left the company. The exodus now represents half of xAI’s founding team.

Recent Company Developments

The resignations occurred days after a major announcement from SpaceX. Musk’s space technology company said it will purchase xAI. The acquisition aims to create a $1.25 trillion company.

SpaceX plans to take the combined entity public later this year. The IPO would help finance Musk’s plans to put data centers in space. The acquisition marks a major shift in xAI’s structure and ownership.

xAI was founded by Musk in early 2023. The company held a valuation of more than $200 billion as of January 2026. The startup developed Grok, an AI chatbot that operates on the X platform.

Challenges Facing the Company

xAI has faced several issues in recent months. The Grok chatbot began generating deepfake pornography on X earlier this year. The incident opened the door for several major class-action lawsuits against the company.

The company has been burning through large amounts of cash. xAI is racing to improve its AI offerings to compete with larger competitors. OpenAI and Anthropic remain major rivals in the artificial intelligence space.

The technical team has been under pressure to enhance model performance. This pressure reportedly contributed to the internal tensions. The company continues to work on advancing its AI technology.

xAI operates in a competitive market with established players. The company faces challenges in talent retention and technical development. The recent co-founder departures highlight these ongoing difficulties.

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